Opinion Writing amp Drafting in Contract Law 2

Order 18 r 7 clearly states that counsel should plead facts and not evidence: a Subject to the provision of this rule and rules 7a, 10, 11, 12 every pleading must tain and contain only a

OPINION WRITING

AND DRAFTING

IN CONTRACT LAW

Cavendish Publishing LimitedCP

OPINION WRITING

AND DRAFTING

IN CONTRACT LAW

Carron-Ann Russell, LLM

of the Middle Temple, Barrister, Attorney-at-Law, Jamaica,

Senior Lecturer, Inns of Court School of Law

Cavendish Publishing LimitedCP

The Glass House, Wharton Street London WC1X 9PX

of the publisher and copyright owner

The right of the author of this work has been asserted in accordance with theCopyright, Designs and Patents Act 1988

Any person who infringes the above in relation to this publication may be liable

to criminal prosecution and civil claims for damages

The aim of this book is to provide an integrated guide of opinion writing anddrafting in the law of contract It will be of use to the Vocational Bar student,intending and non-intending practitioners, Law Society students and studentsstudying for law degrees.

I am grateful to the staff at Cavendish Publishing for giving me the opportunity to participate in this series and especially to Kate Nicol for herpatient and sensitive approach To Hogath Andall, for his help in research andtyping at such short notice To all my old Bar students wherever you are in theCommonwealth Any errors or omissions are my own and in no way reflect onthe publisher Suggestions and discussions on the case papers are warmly invited

To Jah – one love

CARDecember 1995

Preface v

Ailsa Craig Case [1983] 1 WLR 964; [1983] 1 All ER 101 50

Akerhielm v de Mare [1959] 3 WLR 108; [1959] 3 All ER 485 63

Alan (WJ) & Co Ltd v El Nasr Export & Import [1972] 2 WLR 800; [1972] 2 All ER 127 25

Alder v Moore [1961] 2 WLR 426; [1961] 1 All ER 1 96

Allcard v Skinner (1887) 36 ChD 145 108

Alliance Bank v Brown 21

Anglia Television v Reed [1971] 3 All ER 690; [1971] 3 WLR 528 92

Anglo-Continental Holidays v Typaldos Lines (1967) 111 SJ 599; [1967] 2 Lloyd’s Rep 61, CA 94

Apthrop v Neville Co (1907) 23 TLR 575 107

Arcos v Ronaasen (EA) & Son [1933] All ER Rep 646; (1933) 102 LJ KB 346 39

Ashmore, Benson, Pease Co Ltd v AV Dawson Ltd [1973] 1 WLR 828; [1973] 2 All ER 856, CA 106

Atlantic Baron, The [1979] 3 WLR 419; [1978] 3 All ER 1170 21

BCCI v Anybody [1989] 2 WLR 759; [1992] 4 All ER 955 108

Bannerman v White (1861) 31 LJ CP 28; (1861) 4 LT 740 37

Banque de L’Indochine v JH Raymer (Mincing Lane) Ltd [1983] 2 WLR 841; [1983] 1 All ER 1137 20

Bell v Lever Bros [1932] AC 161; [1931 All ER Rep 1 75, 76 Bennett v Bennett 110

Bentley (Dick) Production Ltd v Harold Smith (Motors) Ltd [1965] 1 WLR 623; [1965] 2 All ER 65, CA 37

Bisset v Wilkinson [1927] AC 177; [1926] All ER Rep 343 36, 61 Bliss v SE Thames RHA [1987] 1 CR 700; [1985] IRLR 308, CA 94

British Crane Hire Corp Ltd v Ipswich Plant Hire Ltd [1974] 2 WLR 856; [1974] 1 All ER 1059, CA 50

Bunge Corp v Tradax Export SA [1981] 1 WLR 711; [1981] 2 All ER 540 39, 40 C & P Haulage v Middleton [1983] 1 WLR 1461; [1983] 3 All ER 94, CA 91

CCC Films Ltd v Impact Quadrant Films Ltd [1984] 3 WLR 245; [1984] 3 All ER 298 92

Callisher v Bischoffsheim (1870) 39 LJ QB 181; [1870] 18 WR 1137 20

Car and Universal Finance Ltd v Caldwell [1964] 2 WLR 600; [1964] 1 All ER 290 65

Carlill v Carbolic Smoke Ball Co (1892) 2 QB 484; [1891–4] All ER Rep 127, CA 10, 14, 36 Central London Property Trust v High Trees House Ltd [1947] KB 130; [1956] 1 All ER 256 24

Chandler v Webster [1904] 1 KB 493; [1904] 52 WR 290 83

Chapelton v Barry UDC [1940] 1 All ER 356; (1940) 162 LT 169, CA 48

City of Westminster Properties Ltd v Mudd [1959] 38

Clarke v Dickson (1858) 27 LJ QB 223; [1858] 120 ER 463 66

Combe v Combe [1951] 1 All ER 767; (1951) 95 SJ 317, CA 21, 24 Constantine (Joseph) Steamship v Imperial Smelting Corp The Kingswood [1941] 2 All ER 165; (1942) 110 LJ KB 433 81

Cope v Rowlands [1836] 150 ER 707; (1836) 2 M & W 149 105

Couturier v Hastie [1856] 10 ER 1065; (1856) 25 LJ Ex 253 76

Craddock Brothers v Hunt [1923] All ER Rep 394; (1923) 129 LT 228, CA 80

Cremdean Properties v Nash (1977) 244 EG 547, CA 67

Crowshaw v Pritchard (1899) 16 TLR 45 77

Currie v Misa [1874–80] All ER Rep 686; (1874) 45 LJ QB 852 17

Curtis v Chemical Cleaning and Dyeing Co Ltd [1951] 1 KB 805; [1951] 1 All ER 631, CA 47

Davis Contractors v Fareham UDC [1956] 3 WLR 37; [1956] 2 All ER 145, CA 81, 82 Derry v Peek [1889] 38 WR 33; (1889) 58 LJ Ch 864, CA 63

Doyle v Olby (Ironmongers) Ltd [1969] 2 WLR 673; [1969] 2 All ER 119, CA 67

Dunlop Pheumatic Tyre Co Ltd v New Garage and Motor Co Ltd [1914–15] All ER Rep 739; (1914) 111 LT 862 95, 96 Ecay v Godfrey (1947) 80 Lloyd’s Rep 286 37

Edgington v Fitzmaurice [1885] 33 WR 911; [1881–85] All ER Rep 856, CA 61

Edward v SOGAT [1970] 3 WLR 713; [1970] 3 All ER 689, CA 94

Erlanger v New Sombero Phosphate Co [1878] 27 WR 65; (1878) 48 LJ Ch 73 66

Esso Petroleum Co Ltd v Mardon [1976] 2 WLR 583; [1976] 2 All ER 5, CA 61, 64 Esso Petroleum v Harper’s Garager (Stourport) [1967] 2 WLR 871; [1967] 1 All ER 699, CA 110

Eurymedon, The [1938] 1 All ER 122; (1938) 158 LT 445, CA 22

Everet v Williams (1725) 9 Law Quarterly Review 197 107

Federal Commerce and Navigation v Molena Alpha, The Nanfri, The Benfri,

The Lorr [1978] 3 WLR 991; [1979] 1 All ER 307, CA 40

Fisher v Bell [1960] 3 WLR 919; [1960] 3 All ER 731 10

Foakes v Beer [1884] 33 WR 233; [1881–5] All ER Rep 106, CA 23

Foley v Classique Coaches [1934] All ER Rep 88; (1934) 103 LJ KB 550, CA 34

Goldsworthy v Brickell [1987] 2 WLR 133; [1987] 1 All ER 853, CA 108

Grist v Bailey [1966] 3 WLR 618; [1966] 2 All ER 875 80

Hadley v Baxendale (1954) 9 Ex 341; (1854) 126 New LJ 420 92

Hardwick Game Ltd v Suffolk AG Producer’s Association [1969] 2 All ER 444; [1968] 3 WLR 110, CA 49

Harrison and Jones v Bunten and Lancaster [1953] 2 WLR 840; [1953] 1 All ER 903 76

Hartley v Ponsonby (1857) 26 LJ QB 322; [1857] 5 WR 659 21

Hartog v Colin & Shields [1939] 3 All ER 566 77

Hedley Byrne v Heller [1963] 3 WLR 101; [1963] 2 All ER 575, CA 64, 67 Heilbut, Symons and Co v Buckleton 38

Herbert Morris v Saxelby [1916–17] All ER Rep 305; (1916) 114 LT 618 109

Herne Bay Steam Boat Co v Hutton (1903) 72 LJ KB 879; [1900–3] All ER Rep 627, CA 82

Heron II, The [1967] 3 All ER 686; [1967] 3 WLR 1491 93

Hillas v Arcos [1932] All ER Rep 494; (1932) 147 LT 503 33

Hollier v Rambler Motors Ltd [1972] 2 WLR 401; [1972] 1 All ER 399, CA 50

Holman v Johnson [1775–1802] All ER Rep 98; (1775) 1 Cowp 341 105

Hongkong Fir Shipping Co Ltd v Kawaski Kisen Kaisha Ltd [1962] 2 WLR 474; [1962] 1 All ER 474, CA 39

Horton v Horton (No 2) [1961] 3 WLR 914; [1960] 3 All ER 649, CA 20

Houghton v Trafalgar Insurance Co [1953] 3 WLR 985; [1953] 2 All ER 1409, CA 50

Hughes v Metropolitan Railway [1877] 25 WR 680; (1877) 46 LJ QB 583 24

Hutton v Warren (1836) 1 M & W 466; [1835–42)] All ER Rep 151 41

Hyde v Wrench [1849] 49 ER 132; (1840) 3 Beav 334 10

Ingram v Little 79

Jarvis v Swan Tours [1972] 3 WLR 954; [1972] 1 All ER 71, CA 94

Joscelyne v Nissen [1970] 2 WLR 509; [1970] 1 All ER 1213, CA 80

Krell v Henry [1900–3] All ER Rep 20; (1900–3) 72 LJ KB 794, CA 82

L‘Estrange v Graucob [1934] All ER Rep 16; (1934) 103 LJ KB 730 47, 78

Lambert v Lewis [1981] 1 All ER 1185; [1981] 2 WLR 713 36

Leaf v International Galleries [1950] 1 All ER 693; (1950) 66 TLR 1031, CA 38, 66, 76 Leonidas D, The [1985] 1 WLR 925; [1985] 1 All ER 796, CA 20

Lewis v Averay (No 2) [1973] 1 WLR 510; [1973] 2 All ER 229, CA 79

Liverpool CC v Irwin [1976] 2 WLR 562; [1976] 2 All ER 39, CA 41

Lloyds v Bundy [1974] 3 WLR 501; [1974] 3 All ER 757, CA 108

Long v Lloyd [1958] [ WLR 753; [1958] 2 All ER 402, CA 66

McArdle, Re [1951] 1 All ER 905; (1951) 95 SJ 284, CA 18

McCutcheon v David MacBrayne Ltd [1964] 1 WLR 125; [1964] 1 All ER 430, CA 49

Mahmoud and Ispahani, Re [1921] All ER Rep 217; (1921) 125 LT 161, CA 105

Mann v Nunn (1874) 30 LT 526; (1874) 43 LJ CP 241 38

Maritime National Fish v Ocean Trawlers Ltd [1935] All ER Rep 86; (1935) 153 LT 425 83 Mendelsshon v Normand Ltd [1969] 3 WLR 139; [1969] 2 All ER 1215, CA 52

Miles v NZ Alford Estate Co (1886) 32 ChD 266; [1866–90] All ER Rep Ext 1726, CA 20

Miller v Karlinski (1945) 62 TLR 85, CA 107

Moorcock, The [1886–90] All ER Rep 530; [1886–90] 37 WR 439, CA 41

National Carriers Ltd v Panalpina (Northern) Ltd [1981] 2 WLR 45; [1981] 1 All ER 161 82

National Westminster Bank v Morgan [1985] 2 WLR 588; [1985] 1 All ER 821, CA 108

Nicholl v Ashton Eldridge [1901] 82

Nicolene v Simmonds [1953] 2 WLR 717; [1953] 1 All ER 822, CA 34

Nordenfelt v Maxim Nordenfelt Guns & Ammunition Co [1891–4] All ER Rep 1; (1891–4) 71 LT 489, CA 109

North Ocean Shipping Co v Hyundai Construction Co [1979] 3 WLR 419; [1978] 3 All ER 1170 108

Olley v Marlborough Court [1949] 1 All ER 127; (1949) 93 SJ 40 49

Oscar Chess Ltd v Williams [1957] 1 WLR 370; [1957] 1 All ER 325, CA 37

Overbrooke Estates Ld v Glencombe Properties Ltd [1974] 1 WLR 1335; [1974] 3 All ER 511 67

Pao On v Lau Yiu Long [1979] 3 WLR 435; [1979] 3 All ER 65 107

Paradine v Jane (1947) Aleyn 26; [1558–1774] All ER Rep 172 82

Parker v South Eastern Rail Co (1877) 46 LJ QB 768; [1874–80] All ER Rep 166, CA 48 Parkinson v College of Ambulance Ltd [1924] All ER Rep 325; (1924) 93 LJ KB 1066 106

Patel v Ali [1984] 2 WLR 960; [1984] 1 All ER 978 96

Pearce v Brooks (1866) 14 LT 288; [1866] 14 WR 614 106

Phillips v Brooks [1918–19] All ER Rep 246; (1919) 88 LJ KB 953 79

Photo Production Ltd v Securicor Transport Ltd [1980] 2 WLR 283; [1980] 1 All ER 556 51

Pinnel’s Case (1602) 5 Co Rep 117a; [1558–1774] All ER Rep 612 23, 24 Pym v Campbell (1856) 25 LJ QB 277; [1856] 4 WR 528 35

Raffles v Wichelhaus (1864) 2 H & C 906; [1864] 159 ER 375 77

Robb v Green (1895) 64 LJ QB 593; [1895] 44 WR 25, CA 109

Royscott Trust Ltd v Rogerson [1991] 3 WLR 57; [1991] 3 All ER 294, CA 67

Rutter v Palmer (1922) 91 LJ KB 657; (1922) 127 LT 419, CA 51

Ryan vMutual Tontine Westminster Chambers Asocn (1893) 62 LJ Ch 252; [1893] 41 WR 146, CA 97

St John Shipping Corporation v Joseph Rank [1956] 3 WLR 870; [1956] 3 All ER 683 105 Saunders v Anglia Building Society [1970] 3 WLR 1078; [1970] 3 All ER 961 78

Saunders v Edwards [1662] 82 ER 991; (1662) 1 Sid 95] 107

Scammell v Ouston [1941] 1 All ER 14; (1941) 110 LJ KB 197 33

Schawel v Reade (1912) 461 LT 281 37

Schebsman, Re [1943] 2 All ER 768; (1943) 170 LT 9, CA 98

Schroeder Music Publishing Co v Macaulay [1974] 3 All ER 616; [1974] 1 WLR 1308 110 Scott v Brown, Doering, McNab Co [1891–4] All ER Rep 654; (1891–4) 61 LJ QB 738 107 Scriven v Hindley (1913) 83 LJ KB 40; (1913) 109 LT 526 77

Scruttons v Midland Silicones [1962] 2 WLR 186; [1962] 1 All ER 1, CA 52

Shadwell v Shadwell [1860] 9 WR 163; [1860] 142 ER 62 22

Shaw v Groom [1970] 2 WLR 299; [1970] 1 All ER 702, CA 106

Shirlaw v Southern Foundries Ltd (1926) [1939] 2 KB 206, CA 41

Smith Hogg & Co v Black Sea & Baltic General Insurance Group (1940) 109 LJ KB 848; (1940) 163 LT 261 93

Smith v Hughes 77

Smith v Land and House Property Corporation (1884) 51 LT 718; (1884) 49 JP 182, CA 61 Solle v Butcher [1949] 2 All ER 1107; (1949) 94 SJ 465, CA 62, 80 Spurling v Bradshaw [1956] 1 WLR 461; [1956] 2 All ER 121, CA 49

Stilk v Myrick (1809) 2 Camp 317; [1809] 170 ER 1168 21, 22 Sudbrook Trading Estate v Eggleton [1982] 3 WLR 315; [1982] 3 All ER 1, CA 34

Suisse Atlantique Société D’Armenent Maritime SA v NV Rotterdamsche Kolen Centrale [1966] 2 WLR944; [1966] 2 All ER 61, CA 51

Sutton v Sutton [1984] 2 WLR 146; [1984] 1 All ER 168 96

Sze Hai Tong Bank Ltd v Rambler Cycle Co Ltd [1959 3 WLR 214; [1959] 3 All ER 182] 52

Tamplin v James (1880) 43 LT 520; [1880] 29 WR 311, CA 81

Tapp v Lee (1803) 3 Bos & P 367; [1803] 127 ER 200 62

Tatem (WJ) v Gamboa [1938] 3 All ER 135; (1938) 108 LJ KB 34 83

Taylor v Caldwell [1863] 122 ER 309; [1863] 11 WR 726 81

Thomas v Thomas (1842) 11 LJ QB 104; [1842] 114 ER 330 17

Thompson v LMS Railway Co (1930) 98 LJ KB 615; (1930) 141 LT 382, CA 48

Thornton v Shoe Lane Parking Ltd [1971] 2 WLR 585; [1971] 1 All ER 686, CA 10, 48, 49 Tool Metal Manufacturing Co Ltd v Tungsten Electric Co Ltd [1955] 1 WLR 761; [1955] 2 All ER 657, CA 24, 25 Tsakiroglou v Noblee Thorl GmbH [1961] 2 WLR 633; [1961] 2 All ER 179, CA 82

Victoria Laundry (Windsor) Ltd v Newman Industries Coulson & Co [1949] 1 All ER 997; (1949) 93 SJ 371, CA 93

Walker Property Investments (Brighton) Ltd v Walker (1947) 177 LT 204; (1963) 32 Traff Cas 129 35

Walton Harvey Ltd v Walker and Homfrays Ltd [1930] All ER Rep 465; (1930) 114 LT 331, CA 83

Warner Bros v Nelson [1936] 3 All ER 160; (1937) 106 LJ KB 97 97

Webster v Cecil (1861) 30 Beav 62; [1861] 54 ER 812 81

Welby v Drake (1825) 1 C & P 557 23

White v Bluett (1853) 23 LJ Ex 36; [1853] 2 WR 75 19

White v John Warwick Co Ltd [1953] 1 WLR 1285; [1953] 2 All ER 1021, CA 51

Wickman Machine Tool Sales v Schuler AG [1973] 2 WLR 683; [1973] 2 All ER 39, CA 39

Williams v Bayley (1866) 35 LJ Ch 717; (1866) 14 LT 802 108

Williams v Roffey & Nicholls (Contractors) [1990] 2 WLR 1153; [1990] 1 All ER 512, CA 22

Wood v Roberts [1818] 23

Law of Property Act 1925

s 1(1) 10

Prevention of Damage by Pests Act 1949 127

s 4 136, 137 Restrictive Practices Act 1976 110

Sale of Goods Act 1979 40

s 6 76

ss 12–15 39

ss 12, 13, 14, 15 40

s 23 78

s 52 96

Supreme Court Act 1981 s 35 74, 89 s 35a 74, 98 s 35A 31, 104, 124 s 50 97

Unfair Contracts Act 1977 50, 52 s 2 56

Unfair Contracts Act 1977 ss 2(1), (2), 3(2)(a), 6, 9(1), (2) 53

s 11(1) 67

s 11(4), (5) 54

s 12 53, 56 s 22 56

Sched 1 52

This book is not intended to prescribe a certain way to write an opinion or todraft pleadings There is no prescribed way to do either, subject to any directions from the White Book in respect of pleadings, but there are acceptedformats This book attempts to act as a guide, not a precedent, to analysing,preparing and writing an opinion and drafting certain basic pleadings.

Both opinion writing and drafting skills are fundamental tools which need to

be developed in order to become a competent practitioner These skills are noteasily taught but rather are learned The most this book can do, therefore, is toprovide ideas on how students can teach themselves, with professional guidance, the accepted way to do both tasks

It may appear that some of the ideas suggested seem facile and self-evident.However, in my experience the transfer from a student-focused, academicapproach to law, to a practical professional methodology, is a quantum leap andnot automatic Therefore some steps to use as a guide may prove useful inachieving this transfer However, ultimately, whichever approach studentschoose to adopt is personal and will be reflected in the conduct of their legalwork

This book simply seeks to suggest ideas which have been tried, tested andproven successful I hope the reader will find it of some value at the early stages

of their legal training

CARAugust 1995

Some guidelines

The lawyer’s main goal when retained by instructing solicitors should ably be to help their client by giving sound, fair, impartial and professionaladvice The lawyer, after thorough research, should know the relevant area oflaw on which he is to advise

invari-The purpose of counsel’s opinion is, as the title suggests, to give a view oropinion or to advise the clients of what their chances are in relation to their case,and whether the matter is worth pursuing from a litigation/negotiation point ofview The opinion is written by counsel and is seen initially by a solicitor whothen has a conference with the client to inform them of counsel’s advice or viewabout the matter at hand The style and format of the opinion, therefore, should

be practically oriented and written in a way that allows the solicitor to translatecounsel’s view clearly and easily to the client, without confusing them withcomplex issues of law What the client wants to know from his legal advisers iswhat his chances are of succeeding in his action or defending it

In this regard, then, counsel’s opinion need not be overly legalistic in itsapproach The solicitor will know the law What he wants to know from counsel

is his expert opinion on practical matters: for example, whether damages arelikely to be awarded in this particular case, and if so how much, or what thenext practical or tactical step to take should be, or what the merits of the caseare The lawyer’s opinion should therefore be a legal framework on which coun-sel builds the opinion Counsel should be analysing the facts and relating thosefacts to the law, not to abstract principles of law Counsel is also writing theopinion as a reminder to himself for future purposes, should the matter not pro-ceed immediately to trial but come to trial at a later date If the opinion is clearand succinct, counsel will be able to resurrect the legal issues quickly withouthaving to trawl through all the case papers again It is tempting to read the briefand assume that all the facts are absorbed Often small details can be over-looked, or, if the matter is quite complex, then the significance of certain issueswill be more difficult to grasp

The opinion serves another purpose: it is useful to jog counsel’s mind when,

at some later occasion, he comes to look at the papers on which he will need totake action in relation to the case A well-written opinion depends on a clearand accurate analysis of the facts scenario found in documents and statements

of both lay and expert witnesses and an interpretation of instructions given bythose instructing counsel The key to careful analysis is a sound method for

managing, understanding and organising the facts of the case, identifying thelegal and factual issues and dealing with each issue step by step, chronological-

ly and examining any possible legal implications that may arise in the sequence

The red pencil test: a DIY guide

(1) An initial reading of the papers with an open mind as to what view will

be taken

(2) A clear understanding of what instructing solicitors have asked counsel

to do in relation to the case

(3) A second reading of the papers with a red pencil underlining issues and

concepts that seem to be pertinent to what has been instructed

(4) A third reading isolating under the headings the following in note form:

• Dramatis personae, ie plaintiff, defendant, lay witnesses, expert

• Missing information, such as plans, photographs, maps, reports;

• Strength of the case for and against both plaintiff and defendant;

Dramatis personae

Under this heading all parties must be identified At this stage is not important

to determine whether the particular person is a relevant party to the action Itmay be that this person, although not a major player, ie plaintiff or defendant, isand could be a relevant party at a later stage, ie a third party to whom some lia-bility may be attached or, indeed, a useful witness

Dates and times

All dates and times should be highlighted and noted in chronological order.This will help to set the story in its sequential order and to identify any missingevent or lapse of time It will also confirm that the action is within the limitationperiod prescribed by statute if litigation is being considered

Places

The locus in quo might be a significant or disputed issue in the matter Dates andplaces should be correlated

Relevant figures

Quantum, costs and liability are three of the most important issues around

which many actions revolve It is important therefore to identify the basis onwhich any award may be made or the likely cost that any proposed party to theaction may face by looking at the relevant figures in the case Tabulated headsare useful for identifying figures, in an effort to assess what the overall finalamounts could be

Factual issues

Identifying the factual issues clearly is obviously one of the most importanttasks to be undertaken in order to produce a sound opinion A thorough analy-sis of the facts needs to be made in order to get a total overview of the client’sposition in relation to the law A factual analysis will also help counsel to deter-mine where the gaps and inconsistencies lie in his case, what the cause of action

is likely to be and what, if any, are the potential remedies

Legal issues

Counsel will need to know what the relevant legal issues are Not only themajor and patent issues but very often ancillary issues: whether a particularperson can be joined in the action, whether the limitation period has expiredand what the consequences are likely to be The legal issues should be firmlyrelated to the facts of the particular case The opinion is not a legal treatise but acombination of the law as a broadsheet on which to place and interrelate thefacts

Case for and against both plaintiff and defendant

Counsel will be instructed on behalf of either the plaintiff or the defendant, andthe focus of his advice will be on that party However, in advising his client,counsel will need to be aware of the other side’s case and must be willing totake account of any adverse evidence likely to affect the outcome He shouldadvise accordingly, anticipating what the other party is likely to raise

Evidential difficulties

These matters can determine the success or failure of the case Counsel shouldanticipate what further evidence will be needed and must request it frominstructing solicitors Counsel should expect that the strength of his case willdepend largely on the possibility of adducing the relevant evidence to supporthis case and rebut the opponent’s version of events

Procedural difficulties

Counsel should ascertain from the papers whether any time limits are imminent,whether they will cause difficulty and should deal with them appropriately.Instructing solicitors will often rely on counsel to advise on the next proceduralstep

Missing information

Information in the form of documentary evidence, plans, reports, maps, graphs, real evidence may not be among the papers sent to counsel by instruct-ing solicitors If these exist, they could throw new light on the eventual success

photo-or otherwise of the case Counsel should request missing infphoto-ormation frominstructing solicitors in specific form, for example, a further statement from theplaintiff clarifying X, or an expert report from Y On receipt of this information,counsel will need to amend or confirm the view expressed in his opinion, andadvises how the missing information could enhance or detract from the success

of his client’s case

Strength of the case

More than anything else the client will want to know how robust or weak hisposition is in relation to his opponent’s case From the papers, counsel should

be able to predict a realistic outcome without building up false hopes Counselshould be objective and truthful about the prospects of the case; this should becommunicated clearly and concisely in the opinion

Proposed action

Instructing solicitors may want to know what the next step should be based oncounsel’s opinion: should proceedings be issued forthwith, should a defence befiled, should negotiations take place or should a conference be called? In theopinion counsel will be expected to anticipate what the next course of actionshould be and advise instructing solicitors Having organised all the informa-tion in a manageable form and grasped the thrust of the main issues, the nextstep is to write the opinion

Format of the opinion

The opinion should start with a general brief summary of the facts of the caseand a restatement of what the instructing solicitor has instructed counsel to do

A paragraph summarising counsel’s advice should then follow, stating clearlythe conclusions counsel has reached and what should be done The followingparagraphs should be numbered, sequentially with sub-headed paragraphs,dealing with the various issues and considering the relevant factors as listedabove The final paragraph should draw all the threads of the opinion together,reaffirming counsel’s view of the case

Basic guidelines of drafting and pleadings

Instructing solicitors will sometimes know what pleadings he wants counsel todraft and will make a specific request for that pleading At other times counselwill be asked to draft appropriate pleadings The draft pleadings are to accom-pany the opinion and are equally if not more important than the opinionbecause it is destined not for the client but for the court and the judge’s sight.From the pleadings the judge will be able to gather what the main issues of thecase are and get an overview of the whole case scenario Pleadings should beclear and concise The formal parts of the pleadings are governed by rules of theSupreme Court/County Court and should be adhered to rigidly The rest of thebody of pleadings should tell the story of the case from the point of view ofcounsel who is drafting it Pleadings should not be clustered with unnecessaryinformation but should be incisive in isolating the client’s case In the pleadingscounsel should state the facts and not his unsupported opinion or allegationsmade by the client

RSC Order 18 r 6 gives specific details about the form of pleadings:

(a) Each pleading in an action must bear on its face:

(i) the year in which the writ in the action was issued and the letter and number of the action;

(ii) the title of the action;

(iii) the division of the High Court to which the action is assigned and the name of the judge (if any) to whom it is assigned;

(iv) a description of the pleading;

(v) the date on which it was served

(b) Every pleading must if necessary be divided into paragraphs numbered

consecutive-ly, each allegation being so far as convenient contained in a separate paragraph.

(c) Dates, sums and other numbers must be expressed in a pleading in figures and not in words.

(d) Every pleading of a party must be endorsed:

(i) where the party sues or defends in person with his name and address;

(ii) in any other case with the name or firm and business address of a solicitor by whom it was served and also (if the solicitor is the agent of another) the name or firm and business address of his principal.

(e) Every pleading of a party must be signed by counsel, is settled by him and if not by the party’s solicitor or by the party if he sues or defends in person

Order 18 r 7 clearly states that counsel should plead facts and not evidence:

(a) Subject to the provision of this rule and rules 7a, 10, 11, 12 every pleading must tain and contain only a statement in summary form of the material facts on which the party pleading relies for his claim or defence as the case may be, but not the evidence

con-by which those facts are to be proved and the statement must be as brief as the nature

of the case permits.

(b) Without prejudice to the previous paragraph the effect of any document or the port of any conversation referred to in the pleading must as material be briefly stated and the precise words of the document for conversation shall not be stated except insofar as those words are themselves material.

pur-(c) A party need not plead any fact if it presumed by law to be true or the burden of proving it lies on the other party unless the other party has specifically denied it in his pleading.

dis-(d) The statement that a thing has been done or that an event has occurred, being a thing

or event the doing or occurrence of which as the case may be constitutes a condition precedent necessary for the case of a party is to be implied in his pleading Order 18 rule 11 allows law to be pleaded in exceptional cases A party may by his pleading raise any point of law

Order 18 r 12 outlines what particulars should be pleaded:

(1) Subject to paragraph 2 every pleading must contain the necessary particulars of any claim, defence or other matter pleaded including without prejudice to the generality

of the foregoing words:

(i) particular of any misrepresentation, fraud, breach of trust, wilful default or undue influence on which the party pleading relies and

(ii) where a party pleading alleges any condition of the mind of any person, whether any disorder or disability of mind or any malice, fraudulent intention

or other condition of mind, except knowledge, particulars of the facts on which the party relies.

(2) Where it is necessary to give particulars of debt, expenses or damages and those ticulars exceed three folios they must be set out in a separate document, referred to in the pleading and the pleading must state whether the document has already been served and if so when or is to be served with the pleading.

par-Various types of pleadings

Statement/particulars of claim

In this pleading the plaintiff will tell the story from his point of view, stating hiscase by setting out the allegations he is making against the other side, and par-ticularising what injury or damage he has suffered as a result of the other side’sactions

The statement or particulars of claim will be the pleadings that will start theformal court action

The defence

In response to the plaintiff’s claim, the defendant, if he intends to defend theaction, will respond by serving on the plaintiff his answer in the form of adefence In this pleading, the defendant will either admit, deny or make noadmissions about the various parts of the plaintiff’s claim as presented in thestatement/particulars of claim

Third-party notice

This pleading seeks to join an additional party to the main action, obviating theneed to institute fresh proceedings A third-party notice is normally incurred bythe defendant who alleges that a third party is partially or wholly to blame forthe action which has been brought against him, and he therefore wants to jointhat party in the current action

A third-party notice can stand effectively as the defendant’s statement ofclaim against the third party he seeks to join

Further and better particulars

If pleadings are ambiguous and unclear, the court has power by virtue of RSCOrder 18 r 12(7) to order a party to serve Further and Better Particulars to clarifythe ambiguity at the request of the other party If served after a request, the doc-ument is regarded as a pleading, and must answer specific points requested bythe other side

Counterclaims

A counterclaim allows a defendant in any action who alleges that he has a claim

or any relief against a plaintiff in the action to make a claim by serving a terclaim appended to his defence in the same action

coun-Order 15 r 2(1) states:

A defendant in any action who alleges that he has any claim or is entitled to any relief or remedy against a plaintiff in the action in respect of any matter (whenever and however arising) may, instead of bringing a separate action, make a counterclaim in respect of that matter, and where he does so he must add the counterclaim to his defence.

The purpose of this chapter is not to give a comprehensive summary of the lawrelating to offer and acceptance, but to concentrate generally on a number ofcentral issues which could form the basis of litigation and which will also help

to illustrate the technique of analysis in fact management and opinion writing inthis area

This chapter looks at the essential ingredients that make up the basis onwhich the contract is formed and the process by which parties to a contractreach agreement English law provides guidelines which help to determinewhich promises are legally enforceable Prima facie it could be argued that allpromises should be kept and the promisor should be bound by the promisethey make A promise by Malcolm to take Marlene out to a restaurant for a mealcould be seen to be a completely different situation from one where Lynpromises to buy Frank’s television set for £250.00 In the second situation, mostpeople would argue that if Lyn fails to honour her promise, Frank should havesome legal recourse, while in the first case it would seem inconceivable thatMalcolm should be bound by his promise Although there may seem to be asound legal basis for enforcing that second promise, it seems that both partiesagreed to the terms: Frank placed reliance on Lyn’s promise and as a result suf-fered financial loss In some instances, for example, promises made by familymembers, there is some doubt whether the promise would in certain cases havelegal force

For a contract to be legally enforceable, three crucial elements must be sent:

pre-• agreement between the parties (offer and acceptance);

• bargain (consideration); and

• contractual intention

Offer and acceptance

Parties usually reach an agreement by the making of an offer and an acceptance

of that offer The offer and the acceptance need not be in writing and can bemade by way of a promise In situations where the agreement leaves acts to beperformed by both parties, the contract is described as a bilateral contract; ifthose acts are outstanding to be performed by only one side, then the contract isregarded as a unilateral contract An offer is a statement made by the offeror,the person making the statement who accepts to contract on terms stated and

agrees to be bound by the statement when it is accepted by the offeree, the son accepting to be bound by the offer on those terms An offer may be madeexpressly or by conduct; it may be made to one person, to a group or to theworld at large

per-An important aspect of an offer is that the offeror must intend to be bound

by the offeree, accepting those terms of the agreement without further tion Great care must therefore be taken to distinguish between an offer which islegally binding and an invitation to treat where the offeror invites the offeree tomake an offer, and has no legal status An invitation to treat is perhaps bestexplained by examples: statements of prices, goods on display at a price in shopwindows, or on supermarket’s shelves, catalogues and circulars offering goodsfor sale, an advertisement for an upcoming auction, enquiries about wages, andjob qualifications for a particular job In the classic case of Fisher v Bell (1960) ashopkeeper had displayed a knife in a shop window with a price tag on it anddescribed it as an ejector knife The shopkeeper was prosecuted for offering forsale a flick knife contrary to s 1(1) of the Offensive Weapons Act 1959 The courtheld that the shopkeeper was not guilty of the offence because the displaying ofthe knife in the shop was an invitation to treat and was therefore not a contra-vention of the statute

negotia-Invitation to treat

Not all displays and advertisements are to be regarded as invitations to treat In

Carlill v Carbolic Smoke Ball Co (1892), the court held in the plaintiff’s favour in

deciding on a number of issues raised in the pleadings, that it is possible tomake an offer to the whole world In a more recent case, Thornton v Shoe Lane

Parking Ltd (1971), it is said that a notice which was displayed at the entrance of

a car-park was an offer not an invitation to treat, because the only act of tance necessary was driving into the car-park

accep-In situations where there is dispute about whether the parties were in ment at the material time, the courts apply an objective test to ascertain whatthe parties meant Inferences are drawn from the circumstances of the negotia-tions as to what the parties intended, and their words and conduct are analysedwith a view to determining whether they intended to contract on certain terms,whether the offer was made, communicated and accepted Any acceptancemade by the offeree must relate to the terms of the offer; if the offeree makes acounter offer it negates the original offer so that it cannot be accepted sub-sequently, and it is also tantamount to a rejection of the offer In Hyde v Wrench(1849), D offered to sell P a farm for £1,000 P made an offer of £950 which Drefused P then at a later date said he would pay the £1,000 and sued to enforcethe contract The court held that no contract existed By making a counter offer

agree-of £950, P had rejected and nullified D’s original agree-offer and it was not possible forhim to revive the original offer by a later acceptance

It is generally the rule that the offeree must comply with the terms of theoffer requiring communication of the acceptance to the offeror Any doubt as towhether the acceptance has been communicated effectively must rest with theofferee.

There are exceptions to the general rule relating to acceptance: these refer tocommunications by post or telegram/telemessages The rule holds as a matter

of convenience to the offeree that the acceptance takes place as soon as the letter

is posted A number of restrictions are placed on the rule that help give it a mon sense perspective: the letter must be properly stamped and addressed, itmust be reasonable to use the post in all the circumstances of the case

com-The factual analysis: opinion writing

The main aspects and issues of important areas have now been analysed giving

a basis upon which a case problem relating to those issues can be examined, andthe tools for opinion writing exhibited The rest of this chapter will concentrate

on demonstrating the opinion writing/fact management technique, with panying pleadings

accom-CASE SCENARIO

Counsel is instructed by Dobb & Co Solicitors Counsel has herewith statement

of Mr Ian Kinco Counsel is asked to advise what Mr Kinco’s position is in tion to the following facts Counsel will see that instructing solicitors have sum-marised the situation as best as possible, as no statements are yet to hand and

rela-no supporting documents are yet ready These will be forwarded to counsel assoon as they are prepared

10 June announcing that the phones were no longer available

It would appear that Mr Kinco’s letter arrived on 11 June and was one of thefirst 20 to be received Would counsel please advise accordingly and settleappropriate pleadings

The practical approach

The primary task that needs to be done is a clear analysis of the facts presented,looking closely at chronology, dates and dramatis personae The facts should betaken step by step, examining any possible implications that may arise at eachstage The issues to be resolved therefore must be:

Legal/factual issues

• The state of the advertisement: is it an invitation to treat or an offer?

• How will the court assess the parties’ intention?

• Was Mr Smuck willing to be bound by an acceptance without more?

• Does Mr Kinco accept Mr Smuck’s offer by sending his letter on 9 June?

• Has Mr Kinco satisfied all the conditions of the purported offer?

• What is the significance of Mr Smuck’s withdrawal of the offer on 10 June?

• Is it effective as published?

• What is the nature of the contract?

• Has Mr Kinco suffered any detriment by the apparent breach?

• What is the strength of the evidence in Mr Kinco’s favour?

• Should proceedings be issued and to what avail?

Dramatis personae

• Mr Kinco – putative plaintiff, alleging breach of contract;

• Mr Smuck – putative defendant;

• Monotone Ltd, suppliers – should they be joined as putative defendantthird-party by Mr Kinco?

Gaps in instructions: to be requested

• Evidence of the date of the arrival of the letter;

• Copy of the letter;

• Evidence of posting;

• Copy of Mr Smuck’s advertisement

THE OPINION

Ian Kinco v Joshua Smuck

1 I am instructed by Dobb & Co Solicitors on behalf of Mr Kinco who feels

aggrieved by what he sees as a breach of contract by Mr Smuck in failing todeliver the mobile phone ordered by post I am grateful to instructing solici-tors for a summary of the factual details and in spite of the missing docu-ments will endeavour to advise as instructed

2 Advertisement: offer or invitation to treat

The first issue to be resolved is whether the advertisement contained an offer

or an invitation to treat In deciding the question the court will look at theintention of Mr Smuck, the offeror; this will be assessed objectively Thecourt will have regard to the circumstances of the offer and any otherexpressed or implicit indicators that would support the advertisement as anoffer It is my opinion that the court will look at the wording of the offer,especially ‘will go to’, and may be willing to impute to Mr Smuck an inten-tion to be bound, thereby satisfying one of the fundamental ingredients of anoffer

Carbolic Smoke Ball Co (1893), will apply an objective test in order to find that

an offer was in fact made Does Mr Kinco’s letter of 11 June constitute a validacceptance of the offer? A potential difficulty which may seem to arise iswhether by sending cash when a cheque was stipulated Mr Kinco has ful-filled the conditions required by Mr Smuck The question is: was that stipu-lated requirement a mandatory one and by failing to satisfy that requirementhas Mr Smuck not complied with the required terms? Although I have notseen a copy of the advertisement, from what instructing solicitors tell me,there is nothing to suggest a prohibition on any other form of payment aslong as the total received amounted to £75 Naturally on receiving the adver-tisement my opinion may vary if there is anything to indicate that the

cheque requirement was a mandatory requirement of the contract.Provisionally it is my opinion that on the facts before me there was validacceptance.

4 Finally, the question still left to be answered is whether Mr Smuck’s offer is

still open after the arrival of Mr Kinco’s letter Mr Smuck purports to draw his offer on 10 June I am not told however whether Mr Smuck’s with-drawal has been communicated to Mr Kinco, which is the usual requirement.However, instructing solicitors inform me that Mr Smuck has published anapology in the Wisebourne Times I am not told when Mr Kinco became aware

with-of this advertisement Could those instructing me kindly send me details with-ofthis, and whether this ad appeared in the next issue of the Wisebourne Times

It does seem to me in any event, and certainly an argument open to MrSmuck that the notice revoking as soon as he had received acceptance is rea-sonable This is a fairly strong argument in Mr Smuck’s favour and does in

my view lead me to believe that Mr Kinco does not have a good chance ofrecovering any damages in the circumstances, since Mr Kinco, as far as I amaware has not suffered any detriment by this purported reliance I am at thisstage speculating that this is the case, but should the opposite position be thereal situation, could those instructing me kindly update me with thesedetails in relation to reliance

5 An evidential point which may prove a difficulty for Mr Kinco is proof of

receipt of the letter to Mr Smuck within the time stipulated If the letter hadnot been received as per the terms of the contract, this would significantlyweaken Mr Kinco’s already weak position It is my opinion that subject toreceiving further information from instructing solicitors, Mr Kinco does nothave a strong case and should seriously consider the cost implications ofpursuing this matter Instructing solicitors will see that I have not addressedthe question of whether Mr Smuck should join Monotone Ltd as third party

It is my opinion that this should not be our concern at this stage, as this is acourse of events open to Mr Smuck Instructing solicitors will find attachedherewith a draft copy of statement of claim; instructing solicitors will seethat I have left the details of particulars of loss blank, as I still await thisinformation

B A Barrister

7 Kings CourtChancery LaneLondon W11

The Wisebourne County Court Case no

Between

Ian Kinco: Plaintiff

and Joshua Smuck: DefendantSTATEMENT OF CLAIM

1 The plaintiff is and was at all material times an agent of a retail outlet, ‘TheZones’ The defendant was the vendor of mobile telephones

2 By a contract contained in an advertisement printed in the Wisebourne Timesdated 3 June 1994 the plaintiff agreed to purchase and the defendant agreed

to sell, a Spynx 90 mobile telephone for the sum of £75.00

3 It was an express term of the contract that to be eligible to purchase the saidtelephone, the purchase price should arrive at 10 The Green, Carshalton,Sutton, among the first 20 replies, after the appearance of the advertisement

4 It was an implied term of the contract that the said telephones would beavailable for sale

5 By an advertisement dated 10 June 1994, the defendant wrongly, and inbreach of the agreement, refuted the contract The plaintiff, as he was enti-tled to do, accepted the said revocation

6 By reason of the matters aforesaid, the plaintiff has suffered loss and damage

AND the plaintiff claims:

WC1

It is a general principle of English law that a promise is not as a rule enforceable

in the courts unless it is formalised by incorporation as a deed under seal or ported by ‘consideration’ The purpose of the requirement of consideration is toput some legal limits on the enforceability of agreement when it is informal andgratuitous The most well known of the numerous definitions of valuable consid-eration is that of Lush J in Currie v Misa (1875) that consideration is ‘some right,interest, profit or benefit accruing to the one party or some forbearance, detri-ment loss or responsibility, given, suffered or undertaken by the other’

sup-The central feature of the doctrine is the idea of reciprocity: ‘something ofvalue in the eye of the law’ must be given for a promise in order to make itenforceable as a contract An informal or gratuitous promise does not amount to

a contract The traditional definition concentrates on the requirement that

‘something of value’ must be given in return for a promise However, this is interpreted to mean that consideration is either some detriment to the promisee

re-or some benefit to the promisre-or While it is usual fre-or the promisee to sufferdetriment and create a benefit for the promisor, the promisee may provide con-sideration by doing anything that he was not legally bound to do, whether ornot it actually occasions a detriment to him or confers a benefit on the promisor

It is also well settled that mutual promises can be consideration for eachother Hence, for example, if Yvonne promises to deliver goods to Henry in sixmonths time and for Henry to pay for them on delivery, there is an immediatebinding contract from which neither party can withdraw, though performancecannot be claimed until the appointed time However, a mere mutual desirebehind a promise does not form legal consideration This is so even if thepromisor and the promisee share a mutual motive If May promises to give Alex

£500 to buy some new clothes, and hearing this Ayron goes out and spends £500

on a designer jacket only to find that Naomi later reneges on her promise andrefuses to give him the money, Alex will find that he does not have an enforce-able claim against May Despite May’s promise and the motive behind it, Alexcannot sue her for the money Alex offered nothing of value in the eye of thelaw to May in exchange for the promise; in short there was no consideration forthe promise Similarly in the case of Thomas v Thomas (1842), a husband’s desirethat his widow should live in his house after his death was held not to be part ofthe consideration for the executor’s promise that she could do so

Adequacy of consideration

Under the doctrine of consideration a promise has no contractual force unlesssome value has been given for it However, the courts do not in general askwhether adequate value has been given, or whether the agreement is one-sided

or in other words ‘a bad bargain’ The reason for this is simple The fact that acontract is a bad deal for one party or a particularly good deal for the other doesnot affect the essential legal validity of the contract The mere fact that a con-tracting party pays ‘too much’ or ‘too little’ for something is not irrelevant as itmay provide cogent and compelling evidence of a fraud, a mistake, a breach ofwarranty, frustration or even the abuse of a fiduciary relationship

Past consideration

The consideration for a promise must be given in return for the promise IfSusan makes a present of her old motor car to Celia and a year later Celiapromises to pay Susan £750 there is no consideration for Celia’s promise asSusan did not give Celia the car in return for it In this case the old car is notgood consideration; it is instead ‘past consideration’ and therefore bad In deter-mining whether consideration is past, the court will look to see if the considera-tion and the promise are substantially one transaction The order of the events isnot decisive However, what is significant is the interval between considerationand promise The longer the interval, the more likely the classification as pastconsideration is to be made Whether in a particular case consideration is past

or not is a question of fact In Re McArdle (1951), a woman carried out work to ahouse jointly owned by members of her family After the work had been com-pleted, her relatives signed a document promising to pay her for the work itwas held that she could not recover the sum promised, as her consideration waspast

The test of whether an act done before a promise was made can be ation is threefold: the act must have been done at the request of the promisor; itmust have been understood that payment would be made; and the payment if ithad been promised in advance must be legally recoverable Therefore, if Celiahad asked for Susan’s car and Susan had said that Celia could pay her for it atthe end of the year, then that is valid consideration for the £750 that Celia paysSusan for the car Similarly, in the McArdle case, if the family had asked thewoman to carry out the work and told her that she would be paid, then herwork would have been valid consideration

consider-Consideration from the promisee

The rule that consideration must ‘move from the promisee’ means that a person

to whom a promise was made can only enforce it if he himself has provided the

consideration However, the promisee need not provide the whole tion for the promise: thus he can enforce a promise, the consideration for whichwas provided partly by himself and partly by someone else acting as co-promisee While consideration must move from the promisee, it need not move

considera-to the promisor There can therefore be third-party consideration: for example,Joyce offers Bill £100 to repair Jamie’s car This would be a valid contractalthough Joyce does not receive the benefit of the consideration moving fromBill in return for her promise

In some exceptional circumstances, the promisee (the receiver of the benefit

of the promise) may confer a benefit on the promisor or on a third party without

in fact suffering any detriment himself If, for example, Marie-Lise promisedSunita £100 to repair Marie-Lise’s car and Sunita gets her sister Farida to repairthe car as a favour In this example Sunita has suffered no tangible detriment.The essence of consideration should not therefore be thought to be the fact thatthe promisee suffers a detriment because this will not necessarily always be thecase An act, forbearance or promise will only amount to consideration if thelaw recognises that it has some economic value In the above example Faridaagrees with Sunita to fix Marie-Lise’s car out of natural affection for her sisterand her sister’s friend However, if Farida were to change her mind about fixingthe car there would be no contract between her and Sunita to compel her to fixthe car Farida’s reasons for promising to fix the car are merely sentimental andtherefore unenforceable

Illusory consideration

As well as having some economic value, consideration must not be illusory In

White v Bluett (1853), a son’s promise not to bore his father with complaints was

held not to be sufficient for a promise by the father to discharge the son’s debts

A contemporary example would be if Garfield offers Brandon £30 to stop ing for one week and Brandon has never smoked in his life and is in fact a puri-tanical anti-smoker then the consideration for the promise is entirely illusory.Contrast this situation to the situation where Brandon is a frequent smoker andGarfield shares a desk with him at work In the latter scenario there is a situa-tion where the promise provides an inducement to Brandon for his forbearance.This would be a valid contract even if Brandon had other reasons on his mindfor wishing to stop his cigarette intake over the next week, for instance the per-ceived health benefits of so doing

smok-Consideration is also illusory where the promise alleged to be considerationleaves performance entirely at the whim of the promisor However, such anarrangement can provide real consideration if a definite undertaking not to dealwith any one else is included Therefore an understanding from the manager ofTryall Golf Course to buy some golf balls from Del’s Golf Ball Co at £6 per

dozen can be readily distinguished from a contract for the manager of the golfcourse to buy all his golf balls from Del’s Golf Ball Co

Onerous gifts or collateral contracts as consideration

The reception of a gift of freehold or leasehold property can be valid tion if the holding of such property is sufficiently onerous, for example a free-hold property which is promised to someone if they promise to pay theoutstanding mortgage and other charges can form the consideration for a bind-ing agreement A similar situation would be where Issac promises to give Lynhis leased flat if Lyn promises to fulfil Issac’s repair and rent covenants underthe lease This agreement is binding as Issac has given away both his flat and hislegal liabilities He has received a benefit from Lyn for his promise of the flat

considera-Legal entitlements or liabilities as consideration

It is not surprising that a promise not to enforce a valid claim is clearly goodconsideration for a promise given in return Legal liabilities or entitlement are ofeconomic value and can form the consideration of a valid contract Thereforepromises not to enforce a claim or to abandon a good defence or to abandon aparticular remedy can all amount to valid consideration; compare the decisions

in the following cases: The Leonidas D (1985); Banque de L’Indochine v JH Raymer

(Mincing Lane) Ltd (1983).

It cannot be valid consideration to provide a promise not to enforce a rightwhich is worthless If a claim is invalid because of its nature (for example, agambling debt) then a promise to forbear from legal action in such connection isnot and cannot be valid consideration Similarly, a claim which the promisorknows is invalid or is clearly invalid cannot be the basis in law of good consid-eration However, if there is doubt in law about the case then that can certainly

be valid consideration because there is a possibility of benefit to one party ordetriment to the other as the claim may well turn out to have been soundlybased

The courts have also held in certain circumstances that a promise not to sue an invalid claim (ie that would fail at law) may constitute sufficient consid-eration for a promise to settle by the other party (Callisher v Bischoffsheim (1870)).The provisos that apply in this situation are that: the potential plaintiff has a

pur-bona fide belief in the prospect of his claim succeeding (Horton v Horton (1961) (No 2)); that he has made full and honest disclosure to the potential defendant of

matters which might affect the validity of the claim (Miles v NZ Alford Estate Co(1886)); and he must show that he seriously intended to enforce the claim

A person may forbear or refrain from enforcing a claim without expresslypromising to do so Where there is actual forbearance this may constitute con-sideration In Alliance Bank v Brown the defendant owed the plaintiff bank some

£22,000 The bank pressed him to give some security and he promised so to dobut did not promise themselves not to sue him in the meantime It was held thatthere was consideration for the defendant’s promise as the bank had given, andthe defendant had received ‘some degree of forbearance’ A forbearance onlyamounts to consideration for a promise or performance that is induced by it.Where the forbearance is not requested expressly or by implication it is no con-sideration In Combe v Combe (1951), a husband during divorce proceedingspromised to pay his wife an annual allowance In her action to enforce thispromise one of the wife’s arguments was that she had given consideration for it

by forbearing to apply to the court for a maintenance order The court rejectedher argument holding that she had not forborne at her husband’s request

Performance of existing contractual duty

The general rule in this area is that where there is an existing contractual dutyowed to the promisor by the promisee then mere performance of that duty bythe promisee is not sufficient consideration for a new promise Authority forthis principle is the case of Stilk v Myrick which was reported in 1809 The facts

of the case were that two sailors deserted a ship and the captain promised theremaining eight crew members extra wages if they would work the ship home

to England As they were already bound to do this under their original contracts

it was held that the captain’s promise was not binding The recorded reasoningfor this decision is twofold: first, that such promises could not be made enforce-able as a matter of public policy because that would lead to extortion; and sec-ond, that the sailors provided no consideration by only doing what they werealready bound to do This second strand of reasoning has been subsequentlyfollowed

Where there is a real factual benefit to the promisor and a real factual ment to the promisee, then despite the pre-existence of contractual obligation anew contract may be validly formed In Hartley v Ponsonby (1857), a case with amarked factual resemblance to the scenario in Stilk v Myrick, it was held thatthere was good consideration for the promise to pay extra wages In that casethe desertion of half the crew had effectively changed the nature of the returnjourney, as the fact that the ship was so thinly manned had significantlyincreased the peril of the voyage The existing contractual authority had clearlybeen exceeded and effectively a fresh bargain had been entered into The sameprinciple was applied in the Atlantic Baron (1979) where shipbuilders claimed an